As a gainfully employed twenty-something, you’re likely beginning to enjoy a new level of financial flexibility. Even if you are still paying off student loans, some of the money coming in is sticking around in the form of disposable income. You may have dreamed of this moment in your college days or in the early years of your career but now that it’s here, you may be wondering how you can make the most of your newfound disposable income. Here are 5 tips for saving money in your 20s that can help pave the way for continued financial success.

Start a savings plan.

Disposable income can quickly become a costly temptation and without careful planning, it can go out even faster than it comes in. Following a plan to start saving money in your 20s is a critical first step once you begin earning a real income. Strive to put away some money each month, even if it’s a small amount, and keep a goal in mind to help you stay motivated, whether it’s a dream vacation, your first home, retirement or a rainy day.

Know what you owe.

If it’s been more than a couple years since college graduation, then you likely already know how much you need to spend and save now that you’re on your own. Still, it’s a good idea to regularly take stock of what you owe and to whom in order to stay on top of payments and away from debt. This includes knowing exactly how much you have left to pay back to your student loans. Try using a debt repayment calculator to help you determine when your debts will be paid off so you can more accurately plan for the future.

Create a budget that you’ll actually stick to.

In your mid to late twenties, you’re probably still enjoying an active social life filled with everything from friends’ weddings to Sunday brunches. This time in your life can make budgeting tricky with expenses like gifts and travel cropping up on an unpredictable schedule. But this doesn’t mean that you should forgo setting a budget. Instead, consider setting budgets for shorter periods of time, such as weekly versus monthly, and continuing to contribute to your rainy day fund. This strategy can help you stay on your toes and avoid overspending or having to pass on an event or opportunity.

Begin saving for retirement right now.

You have read and heard enough about saving money in your 20s for retirement to know that it’s important, but 66% of millennials still have nothing saved. While it’s never too late to start saving for retirement, the earlier you get started the more you will be able to save – and the more likely you are to make saving a good habit. If your employer offers a 401k program, make sure you are taking advantage of it, and contributing the maximum employer match while you’re at it. Getting ahead while you have relatively few monetary obligations can help you pave the way for retirement down the road.

Set up a rainy day fund.

If you want to be ready for whatever comes your way but don’t want to keep your disposable income in plain sight, consider starting a rainy day fund. This money can be kept separate from the checking account you use to pay bills so that your rainy day funds can be ready when you need them. If you don’t already use automatic transfers, set one up that will move a small amount of money from your main checking account into your rainy day fund on a regular basis. Once you have a couple of months’ worth of income saved, your rainy day fund will be ready to help you when you need it, whether for unexpected expenses or once in a lifetime opportunities.

Your mid- to late-twenties form an important stage in your life. As you gain more independence and responsibility, the habits you develop now will stick with you. By making smart decisions, being flexible and saving money in your 20s, you’ll be on your way to a stronger financial future in the decades to come.

Find more tips for budgeting and saving money on the FutureTrack Blog, then schedule your complimentary appointment with our team to get your finances on the right track.